Thursday, March 18, 2010

Imagine ...

That the UK kept the government and social policies it has had for the last 50 years, but had never had an Industrial Revolution in the beginning. Wouldn't it look a bit like Kerala without the beaches?

Kerala defies all stereotypes of a "socially backward" Indian state - swathes of people living in abject poverty, men outnumbering women because of female foeticide, internecine caste politics.

Many of its social indicators are on par with the developed world and it has the highest human development index in India. It also has the highest literacy rate (more than 90%) and life expectancy in India, lowest infant mortality, lowest school drop-out rate, and a fairly prosperous countryside.

That's not all.

In contrast to India's more prosperous states, like Punjab and Haryana, Kerala can boast a very healthy gender ratio - women outnumber men here. Life expectancy for women is also higher than for men, as in most developed countries. Thanks to a matrilineal society, women, by and large, are more empowered than in most places in India.

Super. And this is thanks to ?

All this happened because of the region's early trading connections with the West - the Portuguese arrived here in the 15th Century, followed by the Dutch and then the British - and a long history of social reforms initiated by the missionaries and the kings of two princely states that were later integrated to create Kerala.

And thanks to pioneering land reforms initiated by a Communist government in the late 1950s, the levels of rural poverty here are the lowest in India. Decent state-funded health care and education even made it the best welfare state in India.

I'm not sure why the West should have had such a beneficial impact here as compared with the rest of India, where they were also involved in trading.

Yet, today, Kerala is a straggler economy almost entirely dependent on tourism and remittances sent back by two million of its people who live and work abroad, mostly in the Gulf. Joblessness is rife due to the lack of a robust manufacturing base - more than 15% in urban areas, three times the national average. More people here are taking their lives than anywhere else in India. Alcoholism is a dire social problem - the state has India's highest per capita alcohol consumption. People migrate because there are no jobs at home.

Kerala's biggest advantage - high literacy - has become a strange liability: the vast majority of educated unemployed have to go elsewhere for work.

Economists find this paradoxical given the fact that Kerala has met most of the UN's millennium development goals.

Some commentators say the problem stems from the fact that Kerala is an over-politicised and "over-extended state". The argument goes that radical unions, bolstered by successive communist governments, have acted as "pressure groups advancing particular vested interests". In the process, the general prosperity of the state has been neglected.

Hmm. An over-extended state where the unions* act as vested interests to keep the state over-extended, at the expense of general prosperity ? The parallels with the UK get closer ...

"trade unions and political parties are acting merely as pressure groups either to defend the status quo or to extract the maximum possible share of a cake that is not increasing in size"

The parallels aren't exact though. Kerala isn't (as far as I know) importing millions of less-educated people of differing cultures to compensate for the educated Keralans who leave, building up ethnic resentments when integration does not take place. Perhaps they've taken a look at Assam and West Bengal.

(via Steve Sailer, whose view is "if you want to turn your country into Sweden, it's best to get fairly rich first")

* I think unions are a good - indeed a vital - thing in private industry, when they protect workers from employers trying to drive wages down. Alas UK unions support the employers in this.